As with any level of national preparation, the uncertainty of the coming weeks poses a headache for those tasked with maintaining our healthcare supply chain. With only a matter of a possible seven weeks to go until the 31st October 2019 deadline to leave the EU, there are a number of risks and unknowns organisations must address. Alongside the national agenda, which sets out several recommendations, there are also pragmatic steps healthcare providers can take to best prepare, many of which represent good practice.
What are the uncertainties that face the healthcare supply chain?
The healthcare supply chain consists of a thousand moving parts, most of which must work in synchrony to ensure the delivery of patient care. Each link of the chain is highly reliant on the other, making trust and certainty in the process paramount. Lack of visibility and accountability are typically seen as the major challenges that face complex supply chains; some channels are better equipped than others at managing such vulnerabilities, however, Brexit brings about a host of other uncertainties that healthcare organisations must consider:
· The type of customs arrangements which will come into force and whether these significantly impact lead times of goods into the UK;
· The availability of suitable infrastructure (warehousing and logistics) into and across the UK to mitigate impacts;
· Medium-term exchange rate variation impacting supply dynamics;
· Potential changes to product licensing and regulations;
A political deal with the EU which incorporates transitional arrangements for critical matters such as transport, customs, and licensing will lead to greater continuity of supply. A ‘no-deal’, on the other hand, will undoubtedly require a greater level of planning, risk assessment, and risk mitigation. These steps represent good practice at any time however, not just in periods of uncertainty
Pragmatic steps to prepare
Ahead of the original March date and in recent weeks, Akeso & Co have been working with healthcare providers in the NHS and private sector on Brexit planning, including undertaking a detailed data analysis of the at-risk product categories. Based on this, we were able to recommend pragmatic steps, aligned with national guidance, on how to best prepare for the uncertain outcomes of Brexit. Our analysis revealed that actual supply chain risks were sometimes different or even counter to those previously assumed. These recommendations, some of which are Brexit specific, represent good practice for minimising impact of supply chain vulnerability.
1. Trust in the national guidance
Stakeholders across the NHS are under pressure to reassure patients that medications and other medical supplies will not run short after Brexit. Notwithstanding, there is sound logic behind the guidance not to stockpile at Trust level. Should healthcare providers start to bolster stocks in an uncoordinated way, the potential for a ‘bull-whip’ effect is increased, whereby even relatively small changes by a number of purchasers become amplified at the point of supply, meaning that contingency stock is quickly fragmented, actions along the chain quickly become reactive rather than planned, and those in the early stages of the supply chain struggle to cope.
2. Review your continuity plan
All organisations will have continuity plans in place to ensure the ongoing provision of healthcare in the event of negative external circumstances. We have observed, however, that many have yet to update these plans with Brexit in mind. In the next few weeks, it will be highly beneficial for all Trusts to undertake a recap of their continuity plan with specific scenarios in mind. This should include ensuring accountability by reviewing the people and roles documented in the plan are still correct. For example, if you have specific staff who are making supply chain decisions in relation to Brexit planning, they should be included, with an explanation of their duties, roles, and responsibilities.
3. Know where your supply chain risks are
In order to plan correctly, you must first identify the supply chain weaknesses. During our analysis with Trusts, we identified products which were critical to speciality level patient care but had limited coverage (defined as products not stocked in more than 3 locations across an organisation), that presented possible supply challenges. Likewise, some high-use inventory items, originally assumed at risk of supply chain disruption, were found to be at lower risk. Key to these findings is that supply chain disruption due to Brexit cannot be based on assumption and must be founded on detailed assessment based on available data.
4. Share challenges with Partnerships
Shortages are a common occurrence in the medicines supply chain, which in this particular scenario means there is already likely robust expertise in the area to be engaged within your organisation. Pharmacy teams are highly proficient at coordinating drugs, sharing scarce resources, and working together to ensure continuity of supplies.
Outside the organisation, but within specialisms, there could be an opportunity to share problems with partners where this currently does not exist. This can be achieved in a number of ways depending on the products, including within trusts at a local level, partnering at a regional level, or even at a medical speciality level across the country.
This cooperative network for specific products or sub-set of products could allow for coordinated planning with local supply depots and encourage sharing of expertise for particular categories. In exchange, another partner could take responsibility for other products, managed in the interest of the local health economy.
5. Keep your workforce informed
By ensuring your team understands the risks, process changes, and the general landscape being faced in a supply continuity scenario, the better they will be able to cope with any problems they encounter, along with clear protocols for decision making and authorisation.
Bottom line
Although Brexit poses a new challenge, many of the underlying issues that threaten healthcare supply chain are far from new. As we wrote in a reason article of the potential for medicine shortages due to Brexit, “with or without a Brexit deal, medicines shortages will continue to be a problem and the root causes should be given the focus they deserve”. As such, in preparing for any eventual outcome, healthcare organisations must trust national guidance, ensure there is a robust business continuity plan in place, understand the real risks they face, encourage partnership, and keep their workforce informed.
Ultimately, it is those organisations that both prepare and have the flexibility to adapt in the event of any changes that will be best positioned to ensure the timely and continuous supply of medical products.
How can Akeso & Co help your healthcare procurement and supply chain organisation plan for Brexit?
Akeso & Co specialise in helping NHS trusts, and other healthcare organisations assess with their operational challenges. We seek to drive large scale efficiencies, maximise clinical quality, and effective risk mitigation by using data analytics to discover important insights which we integrate with our experience of the healthcare sector.
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